Health Care Summit Today
Reuters: "President Barack Obama takes on healthcare reform at a White House forum on Thursday, seeking to design an overhaul of a costly and inefficient system he believes is threatening the U.S. economy ... The president has not presented a specific reform plan to Congress, seeking to avoid the problems that killed President Bill Clinton's healthcare effort in the 1990s when his administration presented a long, detailed plan to lawmakers."
W. Post looks at reduced intensity of corporate opposition, so far. (But leaves out expected fight over a public insurance plan option):
Obama's opening gambit to dramatically expand the health-care system has attracted surprising notes of support from insurers, hospitals and other players in the powerful medical lobby who are set to participate in an unusual White House summit on the issue this afternoon. The lure for the industry is the prospect of tens of millions of new customers: If Obama succeeds in fulfilling his pledge to cover many more Americans, those newly insured people will get checkups, purchase medicine, undergo physical therapy and get surgeries they cannot afford today...
...The unstated intention of Obama's approach is to dole out the pain in small, easier-to-swallow bites to minimize opposition, White House aides say. Under the president's plan, hospitals, doctors, drugmakers, insurance companies and wealthy seniors -- all of whom will be represented at today's summit -- would sacrifice. But if the system was calibrated properly, no one would lose too much.
Not everyone is happy, of course, and lobbyists and health-care experts warn that major obstacles lie ahead. The seniors lobby AARP, for example, opposes Obama's recommendation to raise Medicare prescription premiums on wealthy retirees. Major insurers also dislike his proposed overhaul of the Medicare Advantage program, which markets managed-care plans to seniors, while home-care providers object to cuts to their Medicare reimbursements.
Dean argued against a single-payer system, against an individual mandate, and for extending free health care to all Americans under the age of 25.
The former DNC Chairman advocated building upon the existing employer-based health care system by giving Americans the choice of keeping their existing insurance plan or enrolling in a new public option. “People hate the health care system, but they love their own doctor and they pretty much like the care they get,” he explained. “So what you cannot do is create some system that is going to scare people.”...
...“The brilliance of Barack Obama’s plan on the campaign trail was a) no one has to change if they like what they’ve got and b) if you want to, you could essentially buy into Medicare,” Dean said. If Obama enacts health reform that contains a public plan option, Dean predicted that Americans will choose it[.]
Left in the West explains why a public plan option is so critical: "...there's a meaningful difference between Max Baucus's plan and the Massachusetts plan: Max Baucus's plan contains a public health insurance option. ... Why is a public health insurance option so crucial? Bottom-line: it gives consumers an option besides the private insurance sector and, as such, keeps private insurance honest."
HCAN's Jason Rosenbaum adds: "It is not a radical change, it preserves choice, and it also can solve the problems inherent in our current health care system, like affordability, equal access, and poor outcomes ... the public health insurance option also has the largest possibility to eat into private insurance profits, and so it’s going to be the piece of Obama’s plan that’s most opposed by business and their aligned conservative groups."
Get Off Like A CEO promotes protest against insurance lobby on Tuesday:
Time's Karen Tumulty looks at the health care crisis from the perspective of her brother Pat, who has Asperger's syndrome: "there are two leading approaches to covering the 45 million uninsured and reining in costs. One, which President Barack Obama is putting forward, would force more employers to offer coverage to their workers, with subsidies and other incentives to make it more affordable. The other, advocated by Republicans (including Senator John McCain in the recent presidential campaign), would take away some of the tax advantages that come with getting coverage at work and thereby put many Americans who are now covered by their employers into the marketplace on their own. The idea is that they would be the ones best equipped to decide which plan suits their individual needs. Pat's experience suggests it is difficult for an individual to make such judgments."
,Reuters reports on new Families USA report: "A third of Americans under age 65 -- 86.7 million people -- went without health insurance at some point during the past two years, according to a report released Wednesday. ... The government's most recent official estimate, based on Census Bureau figures, put the number of uninsured at 45.7 million in 2007. But that figure included only those who had no coverage for the entire year."
Modified Mortgage Bill Gets House Vote Today
The Democratic leadership said it was confident it now has the support to pass the measure, which stalled last week, because of changes won by Democrats who said they feared that homeowners might use bankruptcy to win reductions in mortgages they could still afford. The Senate, where backers of the bill have faced stiff resistance, could consider its own version later this month....
...To appease [conservative-leaning] Democratic critics, backers of the bill made changes to try to ensure that homeowners first sought to negotiate a voluntary loan change from their lenders before filing for bankruptcy.
As a result, the bill requires a homeowner facing foreclosure to seek a loan change 30 days before pursuing one in court and to provide the necessary personal financial information to the lender. Judges would also be required to determine whether a voluntary loan modification had been sought from a lender before the homeowner entered bankruptcy.
Judges would also have to weigh a person’s income against the payments before deciding whether an interest rate or principal reduction was called for and use federally approved appraisal guidelines in determining a home’s value. Other changes are also intended to prevent mortgage reductions in cases in which a person could afford the loan.
Courts are supposed to be able to reduce a mortgage only to the current fair market value of the house and to structure payments in a way that would require homeowners to continue to pay off their original loan to the greatest extent possible considering income.
Congress Matters criticizes Rep. Tauscher's role in altering the bill: "...her position has been spun as being the one in favor of extending more help, more fairly to more borrowers ... Which one of those two provisions -- telling judges they can deny requests for judicial modifications if there was an out-of-court modification offered, and emphasizing reductions in interest over reductions in principal -- is the one that made the bill more fair to more borrowers? I can't tell."
...U.S. Rep. Brad Miller of Raleigh said the measure would serve as a powerful incentive for lenders to work with other homeowners now burdened with hefty mortgages.
For months, banks have been encouraged to offer voluntary loan modifications on mortgages, but the results have been slight. The bill's supporters say the bankruptcy provision will coerce lenders to make loan adjustments on their own - or else face a forced cramdown from a bankruptcy judge.
"The voluntary modifications are just not happening," said Meredith Ezzell, chairwoman of the N.C. state chapter of bankruptcy attorneys. "And if (Congress) puts this in place, they will start happening. This is really the stick that we can hold over their head."
Miller, a Democrat and the architect of the measure, said that's why the banks are opposed to it. "This doesn't beg them to do the right thing," he said. "It doesn't bribe them to do the right thing. It makes them do the right thing."
OpenLeft's ZP Heller also approves: "...for a change, it was a decent compromise. Proponents of this legislation pretty much managed to keep the cramdown provision intact, meaning that bankruptcy judges will be able to modify mortgages for homeowners facing foreclosure on primary residences."
WH Releases Housing Plan Details
People with mortgages as high as $729,750 could qualify for help, and there is no ceiling on how high their income can be as long as they are in danger of losing their homes. Interest rates on loans could go as low as 2 percent for some. Many homeowners could see their mortgage payments drop by several hundred dollars a month, and some could save more than $1,000 a month.
Administration officials estimate that the plan will help as many as four million people avoid foreclosure, at a cost to taxpayers of about $75 billion. In addition, the Treasury Department said it intended to follow up with a plan to help troubled borrowers with second mortgages, which many homebuyers used as “piggyback” loans to buy houses with no money down...
...The new plan, which takes effect immediately, is intended to win much bigger concessions from lenders by offering a mix of generous financial incentives and regulatory arm-twisting. The final impact will depend on how both lenders and the investors who own mortgages respond, but housing experts said the administration had a good chance of achieving its goal.
The eagerness with which lenders agree to modify loans is likely to be affected by [the mortgage cramdown] bill that the House is expected to take up on Thursday.
Separate NYT piece today plays up complaints from homeowners deeply "underwater" who would not be eligible for help. But last month NYT's Leonhardt already covered that point: "There are some big advantages to this approach. Bailing out all underwater homeowners would be tremendously expensive. All told, about $500 billion in mortgage debt is already underwater, and it’s impossible to know in advance who is likely to walk away. So the government would have to spend hundreds of billions of dollars to help millions of people who don’t need help staying in their homes ... For most people, the Fed economists write, being underwater 'is a necessary but not a sufficient condition for foreclosure.'"
Officials were also careful to note that mortgage servicers won't be able to modify mortgages if the terms of their contracts with the investors who own the pools of mortgages don't allow it. That leaves matters at square one for many homeowners, since many investors, like lenders, have been reluctant to take losses in hopes of an eventual government bailout.
Officials confirmed that they have no reliable data on how many of these investors are on the other ends of contracts that prohibit mortgage modifications. That question is important, since many of the weakest loans underwritten during the height of the housing boom, from 2004 to 2006, were sold by now-defunct investment banks to investors abroad, many in Europe.
These pools of mortgages, called mortgage-backed securities, are the so-called toxic assets that are at the heart of the global banking meltdown. This unresolved question about their contract terms is relevant to recovery in housing and the financial sector.
Beat The Press' Dean Baker questions if homeowners or banks get the help: "If homeowners pay more every month than they would to rent a comparable until and still accumulate no equity, possibly facing a short sale when they move (which has the same impact on credit ratings as a foreclosure), then it is not clear how much they are being helped under the plan. With the Obama administration committing approximately $40 billion to this program, or $10,000 for each homeowner assisted under the plan, it is not clear that the benefits to homeowners are very high relative to the benefits to bankers. (The checks are paid to banks.)"
Labor Meets in Miami, EFCA Top Priority
Miami Herald: "Vice President Joe Biden will be in Miami Thursday and Friday for a series of events that include a speech to labor union officials and a visit to a transit hub under construction near Miami International Airport, where he will likely highlight President Obama's stimulus aid for transportation projects. The visit includes an address to the AFL-CIO Executive Council in Miami Beach at 11 a.m. Biden is expected to reiterate the White House position that ''a strong middle class needs a strong labor movement,'' according to a statement from Biden's office."
The Plum Line reports AFL-CIO confident on reaching 60 votes: "On a conference call with reporters today, AFL-CIO legislative director Bill Samuel made it explicit: The forces fighting to get the Employee Free Choice Act passed are certain that they have the support of three key Senators. The three: Blanche Lincoln, Mark Pryor, and Mary Landrieu. If true, this would be a big deal."
AP only gets non-committal statements from the three Senators.
W. Post quotes Samuel: "We've been engaged in a marathon on this, and now we're ready to sprint."
HuffPost's Art Levine on a new report providing additional rationale for EFCA: "The way Big Business leaders and GOP allies like Newt Gingrich tell it, the Employee Free Choice Act is an evil plot to destroy the economy and take away workers' rights to a secret ballot. It's painted as the equivalent of a "nuclear war" that will lead to the "demise of a civilization." But a new report released by the Center for Economic Policy and Research Wednesday shows just why the bill is needed: the chances are one in four that a worker seeking to organize a union will get fired."
Fox News tries to gin up phony outrage that the AFL-CIO winter meeting today is meeting at a Miami hotel.
AIG Bailout Transparency
TPM asks a new question regarding where AIG bailout money ends up: "I can see as well as you that my calls for disclosing the identities of the AIG counter parties have fallen on deaf ears. When Sen. Cantwell (D-WA) asked Secretary Geithner today who they were, his answer was an argument that letting AIG default on its obligations posed too grave a systemic risk to the US and global economies -- a claim which I concede may be true but nevertheless ignored the question: who's getting the money? So how about this? Can we get a clear explanation of why we can't know?"
Brian Beutler asks about the Freedom of Information Act: "AIG was an insurance company. A big part of its business was selling CDSs, which obligated the company to pay out in a huge way in the event of a catastrophic, unforeseen wave of defaults. Then there was a catastrophic, unforeseen wave of defaults, and AIG didn't have enough money to honor its obligations. So the government took it over and you and I are now paying off those debts. But to whom? ... if AIG is now, for all intents and purposes, a government entity, can't that information be FOIA-ed?"
Robert Reich previews conservative attack lines: "The argument that Obama is somehow responsible for the collapse of Wall Street is absurd. First, every major policy that led to this collapse occurred under George W's watch (or, more accurately, his failure to watch). The housing and financial bubbles were created under Bush and exploded under Bush. The stock market began to collapse under Bush ... This bizarre charge wouldn't be worth mentioning were it not a market test for a more intense attack from Wall Street and Republican media outlets next year as the nation moves into the gravitational range of the 2010 midterm elections."
Boston Globe on new "Rebuild and Renew America Now!" campaign: "A coalition of liberal and union advocacy groups that lobbied aggressively for President Obama's economic stimulus package announced today that it will mount a similar effort to push through his budget. The groups plan similar grassroots events, phone banks, and e-mails campaigns targeting members of Congress, as well as paid advertising. More than 40 major organizations have so far signed onto the $5 million to $7 million campaign, Americans United for Change said."
CQ on increasing drama around FY09 appropriations bill, which would provide extra stimulus:
Senate Democratic leaders faced new challenges within their own ranks Wednesday as they pushed a $410 billion omnibus spending package toward passage. As dissatisfaction with the bill became more apparent, Majority Leader Harry Reid, D-Nev., filed a motion Wednesday night to invoke cloture and limit debate on the measure. Congress has a looming deadline for clearing the bill, which would replace stopgap spending legislation for most federal departments. That funding expires Friday...
...Two Senate Democrats — Evan Bayh of Indiana and Russ Feingold of Wisconsin — have said they will vote against the bill. Bayh considers the measure fiscally irresponsible, while Feingold has criticized its earmarks. But some Republicans are expected to support the bill...
...Bayh wasn’t sure how many fellow Democrats would join him in opposing the bill. “I think most people who have concerns about fiscal responsibility are focusing on next year’s budget, not this one,” he said.
Several other Democrats who supported Republican proposals to reduce spending in the omnibus were undecided or planned to support the bill. Ben Nelson, D-Neb., and Claire McCaskill, D-Mo., said they were undecided. Amy Klobuchar, D-Minn., planned to vote for it.
Several Republicans, meanwhile, have sided with the majority of Democrats in opposing one or more GOP amendments to trim the bill. Among them, Thad Cochran of Mississippi, Richard C. Shelby of Alabama and Olympia J. Snowe of Maine said they expected to vote for the bill. Christopher S. Bond of Missouri, Arlen Specter of Pennsylvania and Murkowski were unsure.
Congress Matters' David Waldman questions Bayh's effectiveness: "Yes, yes. We know that you can always get a story in Politico by threatening to buck your leadership. The question is, are you really bucking your leadership? ... what are we seeing [in the votes]? So far, not much in the way of cohesion, though it's beginning to look like Claire McCaskill is more of a fellow traveler with Bayh than previously believed, and that maybe Amy Klobuchar is falling under her sway, which is a bit of a surprise."
Matthew Yglesias: "Evan Bayh & Ben Nelson Join Overclass Revolt Against Obama’s Tax Plans ... if you’re dramatically richer than most Indianans and sociopathically unconcerned with the well-being of your fellow citizens, then Evan Bayh is fighting for you."
Booman Tribune's Steven D: "One point three million jobs lost in the first 2 months of 2009, but Republicans and Blue Dog Democrats are all agitated about increasing taxes on rich people. Go figure."
The Conservative Attack Strategy
Democratic Strategist's James Vega "Obama’s opponents are getting set to 'Unleash Hell'": "...Democrats must begin preparing to defend themselves against a massive, well-financed and coordinated, three pronged offensive ... The Official Party Line ... The 'Responsible' Apologists ... The 'Black Ops’ boys'"
NYT's Carl Hulse on new House GOP strategy: "After weeks of aiming most of their opprobrium at Speaker Nancy Pelosi, with an occasional shot at Senator Harry Reid, the majority leader, House Republicans have been given the green light to go after President Obama’s budget and the chief executive himself. At a private gathering of House Republicans this morning, Representative John A. Boehner of Ohio, the party leader, told his colleagues they should feel free to take on the president over his budget."